Stimulus Bill: Where the money goes

I’m sure that the green energy subsidies will substitute, at least for a time, for policy that addresses climate change. Some basic analysis shows that $37.5 billion in green energy subsidies will lower energy prices, relative to what they would have been otherwise, and increase energy usage putting relatively little price pressure on dirty energy usage. It is cheaper to tackle climate change head on by raising energy prices with a carbon tax or cap-and-trade than to deal with them indirectly in the market for green substitutes. The higher prices could be phased in so that they wouldn’t slow down economic activity during a recession.